0 Rocky Mountain Corporation makes two types of hiking boots- Xactive and Pathbr

Question

0 Rocky Mountain Corporation makes two types of hiking boots- Xactive and Pathbreaker. Data concerning these two product lines appear below Xactive 65.10 $ 18.50 Pathbreaker $ 51.30 $ 13.30 Direct materials per unit Direct labor cost per unit Direct labor-hours per unit Estimated annual production and sales 1.4 DLHs 28,000 units 1 DLHs 78,000 units The company has a conventional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below Estimated total manufacturing overhead Estimated total direct labor-hours $2,379,160 117 200 DLHs Required 1-a. Compute the predetermined overhead rate based on direct labor hours (Round the intermediate

Explanation / Answer

3.) Xactive pathbreaker

Direct material per unit $65.1 $51.3

Direct labor cost per unit 18.5 13.3

Manufacturing overhead per unit 28.42 (1.4 * $20.3) 20.3 (1*$20.3)

Total unit product cost $112.02 $84.9   

Note:-   Predetermined overhead rate = estimated manufacturing overhead / estimated total direct labor hours

   = $2379160 / 117200

= $20.3 per DLH

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